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By Matthew RODGER, Assistant Economist at LGIM
As a whole, major emerging markets (EMs) have become more resilient since the crises of the 1980s and 1990s.
Since the passing of COVID-19, headlines have not made for pleasant reading for investors. Rate hikes, invasions and banking stress have all made market participants sweat. Recession risk has replaced viral risk as the dominant market narrative.
Bad news has certainly impacted returns from EMs. Investors have borne considerable pain following the Russian invasion of Ukraine, with Russian bonds effectively in default with zero recovery rate. The example of Russian sanctions, which barred payment on dollar-denominated debt, must also be playing on the minds of holders of...
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